One way to market the sale price of your home?

Propertyfan

Here's a suggestion. When a prospective buyer makes a bid on your home you can try this response...

Let's say the house is put on the market at £200,000. The offer is £185,000 but you want £190,000. You know the buyer is very reluctant to go higher than £185,000 but you're convinced he/she wants it, they're not keen to pull out and look elsewhere.

You say to the buyer...

"My offer is £190,000 or £187,000 and part of that lower price includes a £1,000 non-refundable deposit sent to my solicitor in the first week of the conveyancing."

The buyer can choose between the 190,000 figure or pay £1,000 as an advance deposit and the remaining amount - £186,000 - will be paid at the end of the process when the contracts are signed and exchanged. Non-refundable deposits are legal. If both parties agree there's no problem. A solicitor is obliged to accept the terms of a non-refundable deposit if instructed by the client. Going with a 1000 quid deposit that can't be returned means you're getting some money even if the deal falls through.

I might consider this approach if I get a new offer on my property.

Herbalus

How likely are they to agree to that? What happens if they then do a survey and find a tonne of problems?

Dan-Dan

I think your approach is a step towards some sort of commitment to purchase , whioch should be introuced anyway , but there will always be the caevat of the survey get out clause anyway

DaftyDuck

Anything... anything that appears in any way more complex than a straight price/acceptance (offers in excess... we pay stamp duty... non-refundable deposit... price for fixtures and fittings...) will reduce interest in your house and, almost by default, will reduce the price you get.

You mention non-refundable deposit when another house owner doesn't, and I wonder what the survey will bring up, what searches will reveal are planning applications, what makes you a difficult vendor.

Sure, if deposits were introduced by statute on all sales, you are back to a level playing field.

In your scenario, you are more likely to persuade the purchaser to raise to £187,500 than accept your proposition. In fact, in my opinion, you are more likely to get £190,000 in a straight deal from them.

_Andy_

If I was a buyer I wouldn't touch that 'offer' with a bargepole.

WellKnownSid

What if I come along a week later, fall in love with your house, and offer the full asking price - £200k

Do you return the 'non-returnable' deposit?

Then I get a rubbish survey and want to knock you down to £180k

Do you go back to the first people and ask for your returned non-returnable deposit back?

eddddy

Propertyfan wrote: »

Here's a suggestion. When a prospective buyer makes a bid on your home you can try this response...

Let's say the house is put on the market at £200,000. The offer is £185,000 but you want £190,000. You know the buyer is very reluctant to go higher than £185,000 but you're convinced he/she wants it, they're not keen to pull out and look elsewhere.

You say to the buyer...

"My offer is £190,000 or £187,000 and part of that lower price includes a £1,000 non-refundable deposit sent to my solicitor in the first week of the conveyancing."

The buyer can choose between the 190,000 figure or pay £1,000 as an advance deposit and the remaining amount - £186,000 - will be paid at the end of the process when the contracts are signed and exchanged. Non-refundable deposits are legal. If both parties agree there's no problem. A solicitor is obliged to accept the terms of a non-refundable deposit if instructed by the client. Going with a 1000 quid deposit that can't be returned means you're getting some money even if the deal falls through.

I might consider this approach if I get a new offer on my property.

Hi propertfan

What you're describing is essentially a "pre-contract deposit agreement". You can google "pre-contract deposit agreement" to find plenty of details from solicitors and others.

They usually allow each party to back out for "good reasons" - like a major problem with a survey - without losing their deposit. But if they back out without good reason, they lose the deposit.

The reasons they are not popular are:
- extra legal costs for drawing up the agreement;
- arguments about which "good reasons" should be included in the agreement at the outset;
- then when a problem actually arises, arguments about whether it is a "good reason" as described in the agreement. (e.g. Are a few broken roof tiles a "good reason" for a buyer to pull out without losing their deposit?)

Ivana_Tinkle

I'd assume there's something wrong with your house and wouldn't consider it.

Also, half the time when a sale falls through there's room for debate about whose "fault" it was. It's often a matter of negotiations breaking down and not being able to come to an agreement (over price, timescale or whatever), rather than one party unilaterally pulling out. Arguing over the deposit would just make everything even more stressful!

SG27

Ha no chance! The seller could take my £1000 and pull out the day after!

Propertyfan

Yes, the one drawback is the potential cost in a solicitor drawing up the deposit contract. If they want a lot then you're spending out more cash.

I think the non-refundable deposit is worth considering if, like myself, you've had your buyer pull out at the last moment. If another buyer pulls out you have peace of mind that you got 1000 quid out of him/her. That might sound a bit uncaring but so is a buyer pulling out of a purchase when the contracts have been sent to the vendor to sign. Once bitten, twice shy and all that....

_Andy_

Well yes it might suit you as a vendor but no buyer is going to touch it with a bargepole.